What is a Veterans Business Loan?
Just like other types of loans, the veterans business loan is a form of obligation or debt that you need to pay back the principal and interest. A lender, credit union, or bank will let you borrow money to start to grow and expand your business, to pay other expenses, or to buy a property.
Military veterans have different options to get funded if you have plans of putting up small businesses. Military Reservist Economic Injury Disaster (MREIDL) Loans, SBA Express, or VA business loans are available Small Business Administration (SBA) to a soldier or their wives who have returned from services or who are going for a deployment.
Also, Read: Top Business Ideas for Veterans in 2021
Three types of Veteran Loans.
SBA Express Loan Initiative
This is open to non-veterans, but veterans have more options and advantages who qualify for this loan. They can borrow up to $150,001 to $350,000 guaranteed. These business loans are payable with interest to The Small Business Administration.
The SBA’s 7(a) loan program.
This business loan is also for both veterans and non-veteran which funded up to $5 million. The veteran guarantees zero fees of $125,000 or less and a 50% reduction for $125,000 above. Veterans have access to training and business counseling, business opportunities, and capital to help them start their businesses.
MREIDL or Military Reservist Economic Injury Disaster Loan
This will provide funding to qualified small businesses to its operating expenses. This is for a military reservist that is qualified but it’s not available due to their role and obligations. The maximum loan amount is $2 million. This is calculated by SBA to the actual economic injury. But MREIDL funds cannot be used in regular commercial debt, to expand the business or refinance long-term debt.
These loans are eligible for veterans, their current spouses or widow, military personnel, and veterans. But veterans who received dishonorable discharge are not eligible for this program.
Check here for SBA Veterans Advantage Documentation Requirements